Aurora Cannabis Inc (NYSE: ACB) is having an incredibly strong start to the trading session this morning, and for good reason. The company announced that it has been selected to be a major part of the medical cannabis space in Germany.
Of course, the news excited investors, sending the stock screaming for the top. Today, we’ll talk about:
- The company’s efforts in Germany;
- what we’re seeing from ACB stock as a result; and
- what we’ll be watching for ahead.
ACB Stock Gains On German Update
As mentioned above, Aurora Cannabis is having a great start to the trading session this morning after announcing an update with regard to its activities in Germany. The update came via press release early this morning.
In the release, ACB said that it has been selected by the German Bundesinstitut für Arzneimittel und Medizinprodukte BfArM (Federal Institute for Drugs and Medical Devices) as a key player in the German medical cannabis space. The company was selected as one of three winners in the public tender to cultivate and distribute medical cannabis to Germany.
In the release, the company said that the contract will be formalized at the earliest on April 17, 2019. This is pending the outcome of an appeal procedure on which a ruling is anticipated on April 10, 2019.
In the release, the company said that the tender had 79 participating companies. The winners, including ACB, are able to establish production in Germany upon the completion of the contract associated with the tender.
The company said that the selection process was based on the submission of a concept for domestic cannabis production, delivery and pricing. In the release, the company said that its concept received the highest ranking out of all concepts submitted, further validating its role as a leader in integrated cultivation, production and delivery.
As a result, it has been awarded the maximum number of 5 of the 13 lots in the tender over a period of four years with a minimum supply of 4,000kg total. The cannabis produced will be sold to the German government and supplied to wholesalers for distribution to pharmacies.
In a statement, Neil Belot, Chief Global Development Officer at ACB, had the following to offer:
We are very proud to have been selected as one of only three companies by the German government, which is a great achievement by our team.
Having the highest rated concept is a strong validation of the Aurora Standard cultivation philosophy, as well as of our track record in the delivery of safe and high-quality medical cannabis products to the German system. We commenced delivering dried cannabis flower from Canada to the German market in 2017, and recently added cannabis extracts to our offerings for German patients. Winning the tender reflects a natural evolution for Aurora, establishing a more prominent local footprint in this important international market with over 82 million people.
The above statement was followed up by Dr. Florian Holzapfel of Aurora Deutschland GmbH. Here’s what he had to say:
Being one of the winners in this tender reflects our ability to work with international governments and establish ourselves as a trusted partner in multiple global jurisdictions. Upon finalization of the allotment we will commence with our project to construct a state-of-the-art cannabis production facility to further service German patients with safe, high-quality cannabis.
What We’re Seeing From the Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. When it comes to ACB, the news proved to be overwhelmingly positive.
After all, this means that the company will be the top medical cannabis producer in Germany. That’s a big win that’s bound to excite investors.
So, it’s not surprising to see that the stock is making its way up in the market this morning. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:18), ACB is trading at $9.25 per share after a gain of $0.30 per share or 3.35% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on ACB. In particular, we’re interested in following the story surrounding the company’s continued work to bring its product around the world. The win in Germany is likely just one of many to come down the line. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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